Saturday, August 23, 2008

IBJ has a must-read article on the mayor's plan to sell off city property, including but not limited to parks. ("Even the City-County Building is on the table.")

while neighborhood activists are upset that their cherished local parks might go on the chopping block, the most controversial part of the plan is the no-bid contract awarded to venture real estate services, wherein venture gets more money the more parks are sold, and doesn't get paid at all if none are sold. under this deal, it's in venture's best interest to do everything it can to sell off as much property as possible. perhaps they'll sell off the city-county building after all.

Julia Vaughn, policy director for the watchdog group Common Cause Indiana, called it a "sweetheart deal" that screams conflict of interest and raises questions about who is looking out for the public’s interest.

"This administration has talked a lot about increasing ethics and the need for transparency and to ensure citizens decisions are being made on their merit, but they really have been glaringly inconsistent in walking the walk," Vaughn said. "This is one of those cases. From start to finish, it doesn’t pass the smell test."

Venture's president is [John] Bales, a Republican donor known to play up his ties to Gov. Mitch Daniels and other political heavyweights. His attorney is Bob Grand, managing partner at law firm Barnes & Thornburg. Grand is president of the Capital Improvement Board and the mayor's right-hand man.

do you think venture was chosen because it was the best firm, or because of the personal ties to bob grand?

Other observers say the selection of Venture could shut out other brokers and may result in good deals for Bales, not the city.

"If you call on a piece of property, will he return your call, will he tell you what the status is and for what price? That's the test," said one top developer who spoke on condition of anonymity. "I will tell you, any broker will tell you, that's not the way it happens. What happens is, he goes out and finds somebody to buy it that he wants to do business with."

Bales has a reputation for landing deals that benefit him as much as his clients, in some cases buying properties his clients are considering leasing. And he's equally known for political connections; he represented his friend Carl Brizzi, the Marion County prosecutor, a few years ago in the lease of 72,000 square feet at 251 E. Ohio St.

the article also quotes gary welsh. i criticize gary a lot, but on this issue—and generally in his (post-election) analysis of the ballard administration—he's dead-on.

Welsh said the mayor's advisers are weaving a tangled web of conflicts of interest. He points to a $30 million real estate investment fund launched recently by Venture that has Bales, Barnes & Thornburg partner Ben Pecar and Marion County Prosecutor Carl Brizzi on its board of directors. The stated mission of the fund: Capitalize on real estate opportunities in Florida and value opportunities in Indiana.

"I don't think Ballard realizes how much they're manipulating him on this stuff," Welsh said.¶